Australia’s RBA Raises Interest Rates to Highest Level in 18 Years

The Reserve Bank of Australia has raised interest rates by 0.25 percentage points, bringing the cash rate target to 4.85 per cent from 4.60 per cent. According to WSJ Economy, the decision follows a material upward revision of inflation forecasts. ABC News AU reports this is the fifth rate increase in 2026 and marks the highest level for the cash rate since late 2008.

The RBA board's decision to increase the rate was not unanimous, with six members voting for the hike and three members voting to keep the target unchanged at 4.60 per cent, ABC News AU reported. The central bank indicated that inflation is forecast to remain high through much of 2027 and is not expected to drop below 3 per cent until late 2028. ABC News AU noted that while the decision impacts mortgage holders, individuals with high-interest savings accounts may see increased returns if their banks apply higher rates.

Brief written by urgent.news from WSJ Economy, ABC News AU — 2 reports on this story. Machine-written — may contain errors; check the original before relying on it.